New Jersey and New York legislators currently are crafting measures that would prohibit the installation of payment assurance devices, including GPS and starter-interrupt units, as a condition of securing vehicle financing. And advocates for the buy-here, pay-here industry are working not only to make sure the current legislation doesn’t become law in the Garden State or Empire State, but also so it doesn’t become the blueprints for other states to adopt.
Assemblyman Paul Moriarty, who represents New Jersey’s District 4 that includes the cities of Camden and Gloucester, is the sponsor of AB 4033, which passed unanimously out of the chamber’s consumer affairs committee last month. Industry sources told BHPH Report that a floor vote on this bill hasn’t been scheduled yet as amendments are being crafted possibly to modify the strict prohibition of the devices so commonly used by BHPH dealers and finance companies that cater to deep subprime consumers.
“We are very aware of what the state of New Jersey is doing. This is a big concern for us,” said Shaun Petersen, who serves as general counsel for the National Independent Automobile Dealers Association.
Soon after the New Jersey legislative committee passed the bill onto the Assembly floor agenda by a 4-0 vote on Jan. 12, members of the Payment Assurance Technology Association (PATA) met with Moriarty and other lawmakers in attempt to share what prohibiting these devices would do to the industry.
Corinne Kirkendall is vice president of compliance and public relations at PassTime as well as a member of PATA’s leadership group. Kirkendall was part of the gathering with Moriarty, who she described as a consumer advocate who questions the entire methodology of subprime auto financing.
Kirkendall recapped that PATA is looking to overcome what she called misconceptions perpetuated last summer when the New York Times published reports about starter-interrupt devices disabling vehicles while they were in motion on a busy freeway. She mentioned that Moriarty might be in favor of modifying AB 4033 as it’s currently written if interest rate caps are instituted on vehicles that have the devices installed.
“We’re working with him to craft legislation we can all agree on,” Kirkendall said.
Meanwhile, New Jersey’s Senate also has a measure that hasn’t progressed as far as the Assembly legislation but contains language that might make BHPH operators cringe. Sen. Nilsa Cruz-Perez, who represents District 5 that also covers Camden and Gloucester, introduced SB 2705 on Jan. 15, and the bill was referred to the chamber’s commerce committee.
The current measure Cruz-Perez sponsored contains a punishment component should the measure become law. BHPH dealers and finance companies would be fined $10,000 for a first offense and not more than $20,000 for any subsequent offense should GPS and starter-interrupt devices be prohibited as a part of finalizing a vehicle installment contract.
SB 2705 also states that potential violations can result in cease and desist orders issued by the New Jersey attorney general, the assessment of punitive damages, and the awarding of treble damages and costs to the injured party.
According to SB 2705 as currently written, “As the subprime auto lending market has expanded greatly in recent years, these devices are increasingly installed on motor vehicles as a condition of securing a loan. Use of the devices is generally unregulated and allows predatory lenders to track and store data concerning the movements of a vehicle without any safeguards for the privacy of its owner or operator, and in the case of devices with starter interrupt capability, allows the remote disabling of motor vehicles without warning, causing potential public safety issues and other serious consequences.
“Accordingly, this bill protects the safety and privacy of consumers by prohibiting the installation of a payment assurance device in connection with a financing or lease agreement,” the proposal continued.
With both measures being introduced in the span of less than two months, Petersen said, “Speaking on behalf of NIADA, I think it was kind of an out-of-left-field thing. It certainly wasn’t something that over the last year or some that was significantly discussed. It’s something we’re adamantly opposed to, and we’ll communicate that concern and displeasure with anybody and everybody that will listen.”
And Experian Automotive data shed light on just how much this legislation could impact the industry in New Jersey.
According to Experian information shared exclusively with BHPH Report, there were 10,889 vehicle installment contracts booked with BHPH operators between January and November of last year. And 28.17 percent of that origination figure generated by BHPH dealers in the Garden State was connected to consumers with credit scores between 350 and 500.
The average credit score for BHPH originations in New Jersey during the first 11 months of last year came in at 538, Experian said.
Experian’s data associated with finance companies — institutions that do not hold consumer deposits but oftentimes finance subprime customers — portrayed similar trends.
The average credit scores for finance company originations in New Jersey during the first 11 months of last year was just 575. The origination total for that span came in at 30,972 contracts.
More Action Beyond New Jersey
As dramatic of an impact the legislation could leave in the Garden State, Kirkendall mentioned state legislators in Virginia, New York, Pennsylvania and Rhode Island currently are or have been considering device prohibition legislation.
While PATA lobbying efforts led Virginia lawmakers to scratch a potential measure, New York legislators in both the Assembly and Senate are crafting similar legislation to what’s on New Jersey’s docket. SB 1547 and AB 3463 were introduced on Jan. 13 and sent to each chamber’s consumer protection committee. Like his nearby neighbor, the sponsor, Sen. Timothy Kennedy, is seeking to prohibit the use of starter interrupt and GPS devices as a condition of vehicle financing. Kennedy represents the 63rd district, which includes a good portion of Buffalo, N.Y.
In writing his justification for this legislation, Kennedy said, “A recent explosion in the subprime auto lending market has some of the same banks and financial institutions responsible for the catastrophic collapse of the mortgage industry in 2008, and consequently, the U.S. and global economies, cashing in big once again. And while these high risk, high-interest loans are on automobiles and not homes, unfortunately, the victims are often low-income consumers still trying to recover from the recent economic recession.
“A growing number of these predatory lenders are now equipping cars with a starter interrupt device as a condition of the loan. This new technology allows lenders to remotely disable the ignition in order to prevent a car from starting within minutes of a payment being late. This reckless practice can threaten public safety and result in serious consequences. Instances of parents being unable to rush seriously ill children to the hospital due to lenders activating the devices are becoming increasingly more common,” Kennedy continued.
Additionally, many of these devices have GPS technology which allow the lenders to track the cars' location and movements with very few regulations to protect individual privacy and public safety. This legislation specifically bans the practice of installing a starter interrupt device as a condition for new or used car purchases, to remedy this gap in the law and further protect consumers,” he went on to say.
In his bill justification, Kennedy also referenced the New York Times’ account of how these devices operate that PassTime fervently refuted last summer. As a result, PATA is meeting with Empire State lawmakers next Monday.
“We’re going to talk through what the devices do through an educational session and provide them with some uniform grass-roots legislation to see if that is of interest to them,” Kirkendall said.
“There is so much inaccurate information in that (New York Times) article. It’s been a good way for the industry to come together and fight this legislation as we’re doing some justice for not only the vendors, but also the dealers and lenders who use the devices,” she continued.
“It’s about continuing to educate and make sure everyone understands what we’re doing and why we’re doing it,” Kirkendall went on to say. “We’re not going to win every one but we’re going to win a lot of battles because we’re doing things the best way we can and we’re not hurting consumers. That’s the true benefit. We’re not trying to hurt consumers. We’re trying to help them.”
Kirkendall added the measures in Pennsylvania and Rhode Island would have to be reintroduced during the current legislative sessions since they didn’t make it out of committee during the last time state lawmakers gathered.
What BHPH Dealers Elsewhere Can Do
Hudson Cook partner Nikki Munro also was part PATA contingent who met with New Jersey legislators. Munro also will be a part of the upcoming gathering in New York. She cautioned BHPH dealers who might not have operations in New Jersey or New York not to brush aside what’s going on in those locations.
“In New Jersey and possibly beyond, we’re not going to get a prohibition but possibly some legislation that allows for the appropriate and responsible use of the devices for collection purposes. Perhaps the legislation will classify the disclosure required and other points like it is required in California,” Munro said.
“Keep an eye what’s going on during your legislative session and be prepared to educate legislators and/or consumer advocates in your area about the responsible use of these devices,” she continued.
And Munro urged BHPH dealers to utilize what she described as the best practices for leveraging the capabilities of GPS and starter-interrupt devices such as disclosures that state details about the use of the device as a means of collection and repossession and how the vehicles can be restarted in an emergency situation.
“I think we have a reaction from legislators who don’t have the full picture of how these devices work and the majority of the dealers who are using them responsibly,” Munro said.
Mike Marak is the president of M&M Auto Sales in Hiawatha, Iowa, boasting more than three decades of buy-here, pay-here experience.
Marak chose to spend three days in Dallas last week for the Best Practices Conference hosted by the National Alliance of Buy-Here, Pay-Here Dealers. Judging by what he shared with NABD afterward, it seems to have been time and money well spent.
“Everything was great,” Marak said. “I did not hear one bad speaker. I learned something in every session, and I have been in the business 31 years.”
NABD highlighted that BHPH operators from throughout United States attended the three-day event, which wrapped up on Jan. 20. The dual-track program focused on best operating practices and compliance for BHPH.
And Marak wasn’t the only dealer who thought spending time away from the store to come and gather information on compliance, collections and underwriting was a prudent move.
“NABD is the leading voice and authority in our industry. There is no close second,” said Al Gardiner, owner of St. Mary’s Motors in Lexington Park, Md. “This show and other NABD contributions are an absolute must for dealers whose livelihood depends on the BHPH industry.”
Jack Bridges, chief operating officer of Credit Now Auto Co. and Atlantic Acceptance Corp., offered a similar assessment.
“Having attended virtually every one of (NABD’s) national conferences over the years, I came expecting to gather a wealth of information and that is exactly what the show delivered and so much more that it’s simply amazing,” Bridges said.
“(NABD’s) conferences are, simply stated, a must for anyone that is serious about learning, improving and growing their BHPH business,” he continued. “In fact, I would say a lot of Credit Now Auto Company’s success over these many years is due in a large part to what we have learned at (NABD's) shows, then brought home and put into practice.”
NABD founder and president Ken Shilson indicated the educational sessions featured 11 dual-track workshops on Sunday afternoon and Monday.
Compliance topics included legal and regulatory updates, handling regulatory investigations, compliance systems and an IRS update. The best operating practices sessions focused on areas such as the Internet, integrated technology solutions, add-ons, maximizing recoveries, performance benchmarks, inventory and reconditioning and capital alternatives.
On Tuesday morning, the workshop sessions combined into a single track, featuring both best operating and best collections panels and a presentation on the new AutoTrader.com Buy-Here, Pay-Here Center.
The best practices sessions featured many of the nation’s most successful operators and industry experts. The compliance program included leading attorneys Tom Hudson, Terry O’Loughlin, Patty Covington, Eric Johnson, David Silverman, Myles Stevenson, Gerald Sachs and other chief compliance officers.
“All the sessions were interactive so attendees could ask questions and get answers to their questions on how to become compliant, and ways to improve their profitability and cash flow, and regain market share,” Shilson said.
“These sessions helped attendees take a proactive approach toward making 2015 a better year,” he continued. “In the highly competitive environment of today, training like this has never been more important. Attendees left with many new ways to increase market share and to avoid legal and regulatory mistakes that could cost them millions.”
Joyce Caudill, vice president of Richwood Acceptance in Walton, Ky., insisted that Shilson and NABD “have their fingers on the pulse of the BHPH industry.”
Caudill emphasized how discussions about the Consumer Financial Protection Bureau taking a great interest in the BHPH space are some of the main takeaways she had from the event.
“As our industry continues to come under close scrutiny and tighter regulation, real-time information on what the CFPB and other regulators are doing, planning on doing and honing in on, is more important than ever,” Caudill said. “The legal experts on the panel were top notch, not afraid to answer the hard questions and get us all on the right path to compliance.
“The technology experts have listened and are treated our business as the real player it is for even more credit challenged customers than ever,” she continued. “Putting all the information in a friendly, exciting format, at one place makes dealer education easier than ever. I tell everyone I know in the business that these conferences are a ‘must do,’ except our competition.”
And dealers weren’t the only attendees who gained valuable experiences out of NABD’s latest event offering. Mike Downey is the vice president of sales and marketing at Auto Master Systems.
“It is obvious that NABD has a great understanding of the needs of today’s dealers by dedicating a conference to the important topics surrounding operation and compliance,” Downey said. “The quality of content offered, and their selection of highly qualified speakers makes attending this conference an easy decision for BHPH operators who want to improve their business.
“We’re proud to be a part of it and look forward to the next one,” Downey went on to say.
And Tax Refund Services and TaxMax founder Bill Neylan added, “The NABD show is a must for all buy-here, pay-here dealers, as well as any vendor in the industry who are looking to better their business.”
NABD announced it will hold its 17th annual National Conference on May 19 through May 21 at the Wynn Hotel Resort and Casino in Las Vegas.
“The Wynn is the finest, five-star, Las Vegas hotel and casino. NABD offers unprecedented room discounts with no resort fees while supplies last,” Shilson said.
In addition, NABD plans to hold a BHPH Boot Camp on Aug. 22 and 23 in Monroe, N.C.
For more information on these upcoming events, visit www.bhphinfo.com or call (832) 767-4759.
Congress empowered the Consumer Financial Protection Bureau to supervise buy-here, pay-here dealers when it passed the Dodd-Frank Wall Street Reform and Consumer Protection Act. Since its inception, the CFPB has not specifically targeted a BHPH dealer — until now, that is.
In November, the CFPB announced a consent order against DriveTime Automotive Group, one of the largest BHPH dealerships in the country, for allegedly harassing consumers with debt collection calls and providing inaccurate credit information to credit reporting agencies. As part of the consent order, DriveTime agreed to pay an $8 million civil money penalty, end the debt collection tactics categorized by the CFPB as unfair, fix its credit reporting practices and arrange for affected consumers to obtain free credit reports.
According to the CFPB, at least 45 percent of DriveTime’s auto installment contracts were delinquent at any given time. When DriveTime consumers fell behind on their installment payments, at least one of DriveTime’s 290 collection employees in two domestic call centers and 80 contractors in Barbados would call them.
Indeed, these employees and contractors placed tens of thousands of collection calls each weekday. At the end of 2013, DriveTime had approximately 69,000 installment contracts that were past due and that these employees or contractors would have been attempting to collect.
Dodd-Frank establishes that companies’ practices can be unfair if consumers cannot reasonably avoid being harmed. The CFPB determined that several of DriveTime’s debt collection practices were unfair to consumers.
Abusive Calling Practices
For example, DriveTime often called borrowers at work, a practice DriveTime management encouraged. Several consumers requested that DriveTime not call them at work, but DriveTime called anyway. One consumer was unfairly called 30 times at work after her do-not-call request.
DriveTime also required consumers to provide the names and phone numbers of at least four references when they applied for financing, a common practice in subprime credit. When consumers fell behind on their payments, Drive- Time called these references.
Many borrowers and references requested that DriveTime no longer make these calls, but DriveTime continued to call. Some references complained that DriveTime called them for months aft er they asked the company to stop.
Finally, DriveTime frequently used third-party databases to find new phone numbers for consumers who fell behind in their payments, a practice known as skip-tracing. Unfortunately, these databases were often wrong.
Upon receiving DriveTime’s calls, many third parties told DriveTime employees or contractors that they had the wrong number and requested that DriveTime stop calling them. Despite such requests, DriveTime continued to call.
In some cases, DriveTime called these wrong numbers for more than a year before stopping.
More Wrongdoing
Unfortunately, DriveTime’s alleged unfair acts did not stop at collection practices. It also allegedly erred in how it reported delinquent information to consumer reporting agencies.
In a number of cases, DriveTime reported inaccurate timing of repossessions and dates of first delinquency. This made it appear on consumers’ credit reports that DriveTime repossessed consumers’ vehicles more recently than the actual date of repossession.
DriveTime also mishandled consumers’ complaints about this inaccurate information. In several instances, consumers disputed the same account information several times without correction.
In other cases, DriveTime falsely told the consumers in writing that it corrected the information. The CFPB specifically found that DriveTime failed to establish and implement reasonable written policies and procedures regarding the accuracy and integrity of the information it furnished to credit reporting agencies.
Ending Result
To settle a potential enforcement action with the CFPB, DriveTime agreed to stop communicating with consumers at their workplaces if consumers have requested that DriveTime not call them there, or if DriveTime otherwise knows that the consumers’ employers prohibit communications to their workplaces.
Additionally, DriveTime cannot call a particular phone number related to an account if any person requested that DriveTime stop calling that number.
DriveTime also agreed to provide a clear and conspicuous notice to existing customers as to how they can limit the times of day that Drive- Time will call them.
For all new customers, DriveTime will provide this notice as part of a written welcome kit. Drive- Time will also provide this notice on the welcome call and, if applicable, at the time of the first collection call on the account.
In addition to agreeing to report only accurate information, DriveTime agreed that if it furnished inaccurate information to a credit reporting agency, it will provide corrected information to the agency or request that the agency delete the wrong information from the consumer’s file.
For consumers about whom DriveTime furnished inaccurate credit information, DriveTime agreed to give them a notice that explains how to obtain a free credit report from each of the nationwide consumer reporting agencies.
Finally, DriveTime agreed to implement a process for auditing information it furnishes to the credit reporting agencies on a monthly basis and monitoring the disputes it receives.
Industry Ramifications
So, if you operate a BHPH dealership, what are your lessons from this consent order?
First, be very careful in how you collect on accounts. If a consumer tells you to stop calling, then stop calling. If you obtain references and a reference asks you to stop calling, stop immediately.
Keep track of these requests in your servicing software and collection call notes. Ensure that your policies and procedures are current.
If you don’t have a compliance management system in place, budget for one in 2015, in a manner that corresponds to the size of your operations.
And finally, if you do report information to the credit bureaus, ensure that the information is accurate.
Catherine Brennan is a partner in the Maryland office of Hudson Cook and can be reached at (410) 865-5405 or by email at cbrennan@hudco.com.
AutoStar Solutions isn’t trying to dampen the Christmas spirit buy-here, pay-here operators might have, but chief legal officer Steve Levine warned dealers of what he described as a potential “Grinch" — regulators such as the Consumer Financial Protection Bureau, the Federal Trade Commission and state attorneys general.
Keeping with the mood of the season Levine shared what he called 12 Days of Dealership Compliance, a rundown of steps BHPH operators can take to keep regulators satisfied.
“The government crosshairs on auto dealers is not going away. In fact, it’s only intensifying,” Levine said. “For dealers big and small, the threat is real, and so is the learning curve.
“This 12-step checklist will give dealers the starting points they need to keep the big government Grinch at bay,” he continued.
• DAY 1: Document the pertinent facts. Protect your dealership from the start, when facts are fresh on your mind and you don’t have to rely on memory. Keep detailed notes about the transaction, negotiation process and customer. They may come in handy later.
• DAY 2: Keep a centralized compliance manual. Type out all your processes, procedures and other compliance-related documentation, then compile them in a large three-ring binder. If a regulator comes to visit, this book should be one of the first things you show him or her. It’s a clear sign that you understand the importance of compliance, and you’ll get big points for effort.
• DAY 3: Get to know your regulators. If you develop a positive relationship with your assigned regulators, you may be surprised at the courtesies they pay you – such as a heads-up phone call when they receive a complaint.
• DAY 4: Hire a specialized attorney. Just because you share a long history with your current attorney doesn’t mean he or she is the right person for automotive regulatory issues. Are car dealers his or her specialty, or just one of the many types of clients in his or her practice? Regulatory compliance is a highly detailed, ever-changing area of the auto industry. As a result, some lawyers who don’t fully understand the car business have unknowingly implicated their clients. Is that a risk you want to take? If you decide to switch, consider an attorney who is an active member of the National Association of Dealer Counsel.
• DAY 5: Reframe your view of complaints. In reality, complaints can be a gift. They may feel annoying, but many of the people who come to you first will complain to a regulator or lawyer if the matter isn’t resolved. In fact, 90 percent of state Attorney General investigations originate from complaints. So consider them a golden opportunity to fix the problem and prevent a regulator from ever hearing about it.
• DAY 6: Audit your deal jackets before turning them over. If you receive an auditor letter asking for a certain number of deal jackets in various categories, by all means, ask your attorney to hand-pick the ones without compliance issues. And only turn over what’s legally required. Miscellaneous handwritten notes or other extraneous documents can implicate you and cause further action unnecessarily.
• DAY 7: Implement progressive discipline for rogue employees. Never, ever turn a blind eye to employees who break compliance rules. If you don’t discipline (and document it), regulatory agencies will hold you accountable for your employees’ mistakes.
• DAY 8: Proactively right your wrongs. This is not the time to shove problems under the rug and hope no one notices. The minute you find a compliance issue, if you can fix it monetarily, do so. Then keep records of any refunds, and tell the regulator if he or she comes knocking.
• DAY 9: Get your advertising house in order. Non-compliant ads and direct mail pieces give regulators a foot in your door, after which they may start poking around in other areas. It’s best to read up on advertising compliance and consult an auto dealer attorney to avoid further trouble.
• DAY 10: Pass on your knowledge. All the understanding in the world about compliance issues means nothing if your staff doesn’t share that knowledge. Regulators will investigate whether you train your team to comply, or set policies just for show.
• DAY 11: Assume your regulator has little to no experience with dealerships. State Attorneys General, for example, oversee so many industries that most of their lawyers possess only a basic understanding of the auto world. It’s your job to help them understand how things work, and why.
• DAY 12: Be as nice as humanly possible. Some dealers take a risky approach with regulators … confrontation. It simply doesn’t work. The government possesses all authority and leverage in this situation. But they are people too, so behaving as kindly as you can muster will go a long way.
Operators can gain an in-depth compliance education by joining Levine and some of the most-respected automotive compliance experts in the country at the next Innovate Conference, coming next fall. Dealers can sign up to get conference updates, ticket information, a list of speakers, the full breakout schedule and more at www.myinnovate2015.com.
Ken Shilson, founder of the National Alliance of Buy-Here, Pay-Here Dealers, joined the leadership of the National Independent Automobile Dealers Association for its annual leadership meetings in Washington, D.C., to help champion positions important to BHPH operators.
Shilson left Capitol Hill with three related takeaways from those gatherings; a trio of points NABD is using to help sharpen the agenda for its next event — its Best Practices Conference on Jan. 18 through Jan. 20.
Shilson noted several members of Congress indicated that the “tax extender” provisions will likely be approved by both chambers before they recess this month. Shilson emphasized this development indicates that tax refunds should not be delayed significantly in 2015.
“I anticipate these tax refunds will begin around Feb. 1 provided that Congress acts as they indicated,” Shilson said. “The competition for these refunds has increased as subprime lenders, credit unions, and franchise dealers compete for BHPH customers. Operators must be very proactive in this tax season to recapture market share.”
Shilson insisted the Consumer Financial Protection Bureau and Department of Justice continues to closely monitor the BHPPH industry for deceptive advertising, alleged unfair and deceptive lending practices, data privacy, collection abuses and discrimination.
“Operators must avoid these problem areas in 2015 to be compliant,” Shilson said. “You can’t afford to make legal and regulatory mistakes if you want to succeed. Appointing a chief compliance/privacy officer to implement a compliance management system is the first step. Training dedication of resources must come next.”
In recent discussions with BHPH operators around the nation, Shilson mentioned that they acknowledged “the old ways” are just not working like they previously. He suspects the reasons stem from increased competition as well as economic and regulatory changes.
“You can’t expect to do the same things in 2015 and have better results,” Shilson said. “It is time to rethink your business model, implement technology, learn from your losses and get compliant.”
With that thinking in mind, the NABD is hosting a Best Practices Conference at the Hilton DFW Lakes Executive Conference Center in Dallas,
“This conference is designed to address the biggest challenges the subprime auto finance industry is facing today,” Shilson said. “The buy-here, pay-here operator is now facing stiff competition from finance companies, credit unions, and franchise dealers. Therefore, BHPH operators must find new ways to retain and regain their customers and increase market share during these highly competitive times.
“The old ways just aren’t working because the industry economics and customer behavior have been altered by all this competition for subprime customers,” he continued. “In addition, our industry is facing some new regulatory challenges from the CFPB, the Federal Trade Commission and state attorneys general. Legal and regulatory mistakes can prove very costly as evidenced by the most recent $8 million penalty assessed against a major BHPH operator.”
In response, NABD assembled outstanding experts, attorneys, operators, and former regulators who will provide tips, techniques and best practice ideas that will help operators navigate through these challenges in 2015.
“You can’t do the same things next year and expect to be more successful,” Shilson said.
NABD emphasized that operators must now be more proactive in their compliance efforts in order to avoid significant penalties and business disruption caused by increased regulatory scrutiny.
“However, the industry struggles with what to do and the expense associated with all these compliance requirements,” Shilson said. “At this conference we will explain what operators must do now and how they can comply cost effectively.
“We are not receiving much insight from Washington so we must seek input from former regulators who can share their knowledge,” he continued. “Operators who believe compliance is expensive will learn that non-compliance is much worse.”
NABD contends the timing of this event can allow operators to start the New Year by doing the “right things,” which can improve their results.
Shilson highlighted the DFW Lakes Executive Conference Center is a facility located near Dallas-Fort Worth International Airport, and ground transportation to and from the conference center is provided.
For attendees who wish to drive to the event, free parking is available.
NABD arranged significant discounts on rooms while supplies last. No resort fees are charged to guests and the property has a fitness center, indoor pool, and other amenities.
“This event is very affordable for all key personnel,” Shilson said.
The dual-track program will cover both operating and compliance best practices. Operators are encouraged to send at least two employees so they can attend both tracks.
“Unlike other trade shows, this educational conference is specifically designed for the BHPH industry so all the sessions will focus on relevant information,” Shilson said. “The sessions are interactive so individuals can take away answers to their specific questions.
An agenda and information on keynote speakers is available at www.bhphinfo.com.
The exhibit hall features all the latest products and services available to help increase profits and cash flow. Two receptions, a breakfast, and a luncheon are included and these are designed to facilitate networking with the experts, exhibitors, and other attendees.
“A very limited number of exhibit spots remain available,” Shilson said.
To secure space, exhibitors can call Keith Shilson at (832) 767-4759.
Significant early registration discounts are available for paid registrations received prior to Friday. Some discounted rooms remain available at the Hilton DFW Lakes, so attendees are urged to reserve now to receive the discount.
“Hoping next year will be better is not a prudent strategy,” Shilson said. “Operators are encouraged to ‘work smarter, not harder’ in 2015. This conference will get them pointed in the right direction.”
Since my retirement from active skip-tracing eight years ago, I now have the opportunity to sit back and observe the industry closely. Since I’ve taken on a teaching and training role, reaching a new generation of skip-tracers with MasterFiles, I hear much talk and concern on the topic of best practices and compliance.
To the late-comers I say, “Welcome to the party!”
To those of you who have spent an entire career making sure that your company and your team are well-trained and educated in the local, state and federal regulations, this subject is nothing new. The organizations that have always advocated methods to maintain compliance typically seem to rise above the rest, survive and prosper even in the tough economic times of today.
Today I would like to shed more light on the sometimes neglected skip-tracer. In any operation, they can be one of your greatest assets: making you a profit and/or reducing your losses.
Or they can be detrimental to your bottom line.
Characteristics of Skip-Tracing
A true skip-tracer in 2014 has to be an expert on many things — human nature, interviewing skills, understanding the complex world of data and much more. Yet I believe that the most valuable asset they can bring to their profession is a working understanding of all the regulations that a skip-tracer must function within.
We all know that skip-tracers are often pushed into situations which have them sacrificing fundamental good practices in the quest for rapid results. When they’re being told to, “find that Skip by any means necessary; I don’t care what it costs,” a simple slip-up on third-party disclosure, an unconscious violation of GLB, FDCPA, FCRA, or a careless disregard for the Pre-Text Act is not unheard of.
Yet it can come with tens of thousands in fines and possible jail time. In September of last year the Telecommunications Act of 1996 had an amendment added in September of 2013, and we can’t forget about the Truth in Caller ID Act, as well.
We now live in a regulation nation — the CFPB and all the regulations and more are here to stay. I may be in the minority here, but in some ways I like the regulations and compliance. It serves as a way to elevate the industry and dispel perceptions on who and what we are. Skip-tracers have always been a highly educated creative group of men and women.
Now we have the ability to show what it takes to be a true professional in the industry — one who knows the law and is successful working within it.
Today, a skip-tracer must juggle legal compliance with the ability to locate a human being who does not want to be found. Skip-tracers often find themselves navigating mine-fields of regulations, risking lawsuits from debtors, fines from governmental regulators and the possibility of a criminal record.
Given the range of risks, and the quagmire of legalities, it is usually impossible to cover the training needed at a once-a-year conference event; and even if attempted, most of the time it is the owner or manager who attends and not the person performing the task.
Importance of Ongoing Training
I tip my hat to Ron Brown, who has started the 20 Group process within the collateral recovery industry. His Eagle Group provides monthly meetings, conference calls, sharing of information and much more. They cover everything needed to be successful in today’s environment.
The American Recovery Association, in partnership with the Recovery Industry Services Company (RISC), has started online webinars to help their members get into, and stay in compliance with all the regulations.
Leaders from both of these esteemed organizations understand the value of education and training for not just an owner or manager, but also for everyone employed within the company.
It is only with this type of forward thinking that we, as an industry, will prosper and stand head and shoulders above all others as we meet the challenges, and the rewards, to come in the months and years ahead.
For 27 some-odd years I have been a proud skip-tracer, and nothing but a skip-tracer. It is all I have done or ever wanted to do, and it has been the most rewarding experience of my life. The honor comes through knowing the men and women of the industry that have crossed my path over the years, and who have graciously mentored me from the age of 24 or 25 years old to today.
In many cases they have been the legends of the art of skip-tracing, and the auto finance, law enforcement and bail enforcement industries.
We all can agree that the days of the Wild West are far behind us and will not return. My wish is for all the associations to band together, if for nothing else, then for education and compliance.
Today’s Pitfalls
We all deal with sensitive data in our day-to-day activities — from customer applications, to internal files, to data retrieved from the net. We are all charged to be good stewards of this data, and if we aren’t, we can lose that privilege.
Being without access to data in today’s world would make our jobs nearly impossible.
The following cases are perfect examples of some horror stories I have heard during my travels of how failing to protect the data can be a costly mistake. In one case a debtor’s file was a left in a repossessed vehicle.
When the lending institution gave the car back to the debtor for payments, the car owner found the file containing her own sensitive data carelessly abandoned inside the vehicle. The car owner filed suit for invasion of privacy, and the business owner ended up having to pay off the debtor’s auto to settle.
In another case a bondsman terminated an employee who lacked morals but possessed a good memory. She remembered to take her old login and password with her to her new job at the competitor’s business. Because the previous employer had failed to terminate the ex-employee’s access, she racked up enough usage to stick her former boss for a six thousand dollar bill.
Each of these expensive mistakes could have been prevented by having some simple office security policies in place, which would not only enhance the daily functions of a business, but also allow the business owner a better night’s sleep.
An Opportunity to Gather
At the North American Repossessors Summit in Dallas beginning on March 12, I will be speaking on this subject and effective communications for the skip-tracer. I look forward to meeting you there.
Below are just some examples of the policies and procedures that are warranted by the sensitive (and costly) nature of protected data:
• Formal and documented security policies, standards, plans and procedures
• Written policy or standard regarding data privacy (signed by all staff members)
• Internet access and use policy
• Encryption policy and standards
• Security incident management policy
• Policies for managing external communication devices and removable media
• Restrict access to information and technology to your staffs job function
• Establish a process for granting and documenting system access, including but not limited to access for third parties and remote access.
• Disable user names and passwords associated with employees that are terminated or transferred.
• Prevent removing secure information or related assets (storage media, hardware) from the premises.
• Equip Security Cameras to cover inside and outside doors and areas associated with access to secured data
• Electronically alarm all doors and/or windows
Alex Price is a nationally recognized expert on the art of skip-tracing. Currently he is the executive vice president for MasterFiles and author of Skip Tracers National Certification Program, The Florida Records Guide, The Military Installations Guide and blogger with more than 25 years of experience in skip-tracing, collections and public speaking. He can be reached at alex.price@masterfiles.com (972) 735-2353.
The Consumer Financial Protection Bureau made its first enforcement action in the buy-here, pay-here space and handed out an $8 million penalty against one of the largest operations in the business — DriveTime Automotive Group.
CFPB officials said late Wednesday that DriveTime harmed consumers by making harassing debt collection calls and providing inaccurate credit information to credit reporting agencies.
The bureau said DriveTime must pay $8 million as a civil money penalty, end its unfair debt collection tactics, fix its credit reporting practices and arrange for harmed consumers to obtain free credit reports.
“Consumers who purchase a car at a buy-here, pay-here dealer deserve to be treated fairly,” CFPB director Richard Cordray said. “DriveTime harassed and harmed countless consumers, many of whom were economically vulnerable.
“Our action forces DriveTime to pay the price for its illegal debt collection tactics and for neglecting the accuracy of consumers’ credit information,” Cordray continued.
In an exclusive statement to BHPH Report sent today, DriveTime executive vice president and general counsel Jon Ehlinger shared the company’s reaction to the actions handed out by the bureau.
“We are pleased to have a resolution to the Consumer Financial Protection Bureau (CFPB) investigation, and appreciate and acknowledge the professionalism shown throughout the process by the CFPB and its enforcement staff,” Ehlinger said.
“Currently, the CFPB supervises large banks that provide auto loans, but not nonbank finance companies. Under a recent proposal to oversee large nonbank lenders, it appears that DriveTime will be subject to supervision by the CFPB beginning as early as 2015,” he continued.
“DriveTime strives to comply with all applicable laws and provide exemplary service to our customers. Over the last several years, prior to the initiation of the CFPB investigation, DriveTime had taken and has continued to take steps to enhance its customer experience, and loan servicing activities, including the handling of do not call requests and credit reporting,” Ehlinger went on to say.
“We look forward to an ongoing relationship with the agency, and hope to establish a constructive dialogue designed to improve our customer service and compliance practices in the years ahead,” he added.
Ehlinger also mentioned that DriveTime is encouraging any customer with questions or concerns to contact the company by visiting a special website at https://www.drivetime.com/info/cfpb-settlement.
Breakdown of Actions
The bureau’s investigation showed DriveTime’s average customer has an annual income of $37,000 to $50,000 and has a FICO score between 461 and 554.
DriveTime operates 117 dealerships in 20 states and, as of Dec. 31 of last year, held more than 150,000 outstanding auto installment contracts.
Generally, the CFPB insisted that at least 45 percent of DriveTime’s auto installment contracts were delinquent at a given time. When DriveTime consumers fell behind on their installment payments, the bureau described DriveTime’s “extensive” collections operation began calling them.
The CFPB said DriveTime had at least 290 collection employees in two domestic call centers and 80 contractors in Barbados. These employees and contractors placed tens of thousands of collection calls each weekday.
At the end of 2013, the CFPB determined DriveTime had approximately 69,000 installment contracts past due that these employees would have been calling on.
The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) establishes that companies’ practices can be unfair if consumers cannot reasonably avoid being harmed. The bureau determined that several of DriveTime’s debt collection practices were unfair to consumers.
The CFPB found that DriveTime violated federal consumer financial laws and harmed consumers through illegal actions such as:
— Harassing borrowers at work: DriveTime collectors often called borrowers at work, and DriveTime management encouraged these calls. Several consumers requested that DriveTime not call them at work but the CFPB said DriveTime kept calling anyway. For example, officials indicated one consumer was unfairly called 30 times at work after her do-not-call request.
— Harassing borrowers’ references: DriveTime required consumers to provide the names and phone numbers of at least four references when they applied for financing. When consumers fell behind on their payments, the bureau indicated DriveTime called these references. Many borrowers and references requested that DriveTime no longer make these calls, but DriveTime did not stop, according to the CFPB. Officials added Some references complained that DriveTime collectors called them for months after they had requested that the company stop. The CFPB determined that this practice was unfair to consumers.
— Making excessive, repeated calls to wrong numbers: To reach consumers who fell behind, DriveTime frequently used third-party databases to find new phone numbers. The bureau determined these databases were often wrong. Upon receiving DriveTime’s calls, numerous third parties told DriveTime they had the wrong number and requested that DriveTime stop calling them, according to officials. Despite such requests, the CFPB indicated DriveTime continued to make these calls. In some cases, DriveTime called these wrong numbers for over a year before stopping.
— Providing inaccurate repossession information to credit reporting agencies: DriveTime furnishes consumer account information for approximately 350,000 accounts to all three major consumer reporting agencies. In a number of cases, the CFPB found that DriveTime gave the agencies information that inaccurately reflected the timing of repossessions and dates of first delinquency. The bureau explained this situation made it appear on consumers’ credit reports that consumers’ vehicles had been repossessed more recently than the actual date of repossession.
Officials believe this information can have a negative effect on consumers’ credit reports, which in turn can impact their ability to get credit, employment, or housing. The Fair Credit Reporting Act prohibits companies from furnishing inaccurate information when they know or have reasonable cause to believe the information is inaccurate.
— Failing to properly handle credit information furnishing disputes: The CFPB said DriveTime also mishandled consumers’ complaints about the inaccurate information it had provided to the credit reporting agencies. In several instances, officials recounted that consumers disputed the same account information several times without the inaccurate information being corrected. In other cases, the bureau noted DriveTime informed the consumers in writing that the information had been corrected, when it had not been. This was a violation of the Fair Credit Reporting Act, which requires that companies properly investigate disputes.
— Failing to implement reasonable procedures to ensure the accuracy of consumers’ credit information: The bureau determined DriveTime failed to establish and implement reasonable written policies and procedures regarding the accuracy and integrity of the information it furnished to credit reporting agencies. The policies and procedures it had in place were not appropriate to the nature, size, complexity, and scope of its furnishing activities, according to officials. The Fair Credit Reporting Act requires that companies have policies and procedures in place to ensure the accuracy and integrity of consumers’ credit information.
More Details About Enforcement Action
Pursuant to the Dodd-Frank Act, the CFPB has the authority to take action against institutions or individuals engaging in unfair, deceptive, or abusive acts or practices or that otherwise violate federal consumer financial laws.
The CFPB’s consent order requires DriveTime to:
— End unfair calling practices: DriveTime must not communicate with consumers at their workplaces if consumers have requested that DriveTime not call them there or if DriveTime otherwise knows that the consumers’ employers prohibit communications to their workplaces. DriveTime must not call a particular phone number related to an account if any person has requested, orally or in writing, that DriveTime stop calling such number.
— Disclose collection options to consumers: DriveTime must provide a clear and conspicuous written notice to existing customers explaining how they can limit the times of day that DriveTime will call them. For all new customers, DriveTime must provide this notice as part of a written welcome kit. DriveTime must also provide this notice on the welcome call and, if applicable, at the time of the first collection call on the account. DriveTime must accept customers’ oral or written requests to limit calls.
— Cease furnishing inaccurate repossession information: DriveTime must stop furnishing information related to the repossession of a consumer’s vehicle, unless the company has confirmed that the information is correct.
— Correct credit reporting information: If DriveTime furnished information to a credit reporting agency that was inaccurate for multiple accounts for similar reasons, the company must provide corrected information to the agency or request that the agency delete the wrong information from the consumer’s file.
— Provide credit reports to harmed consumers: For those consumers about whom DriveTime furnished inaccurate credit information, DriveTime must provide a notice that explains how to obtain a free credit report from each of the nationwide consumer reporting agencies. If the customer has already received a free report during the preceding 12 months, DriveTime must arrange for the customer to obtain a credit report free of charge.
— Implement an audit program: DriveTime must implement a process for auditing information it furnishes to the credit reporting agencies on a monthly basis and monitoring the disputes it receives. The audit is designed to ensure the integrity and accuracy of the information.
— Pay an $8 million penalty: DriveTime will pay an $8 million penalty to the CFPB’s Civil Penalty Fund.
Get compliant and stay compliant. It’s the regulatory chorus buy-here, pay-here operators have seen and heard if they’ve read any previous issues of BHPH Report, attended an industry event or traded war stories with fellow dealers.
The managers of AutoTrader.com’s new Buy-Here, Pay-Here Center aren’t trying to add more noise to the compliance discussion, but rather are bringing on board a legal expert who is being charged with explaining issues in a concise manner for dealers who are using this BHPH marketing tool.
Dealers who sign up or already are part of the Buy-Here, Pay-Here Center will now see compliance commentaries from David Silverman, who operates his own firm in Englewood, Colo.
An attorney since 1982, Silverman served two terms on the board of directors for the National Association of Retail Collection Attorneys (NARCA), the premiere trade association for Creditor Rights Counsel. He has been published in the Washington Journal and the Commercial Law Bulletin, has been a contributing author to the original publication of State FDCPA Laws and how they now apply to creditors, as well as being a convention chair and speaker at NARCAs conferences.
Silverman also has served as Judge Pro Tem in municipal and small claims court.
“We want to provide dealers with the tools to be compliant,” said Brett Kelly, the director of independent dealer business at AutoTrader.Com. “It’s one thing to say that. It’s another thing to actually help dealers do it.
“For example, if a dealer mentions a down payment, which we encourage them to do, we also have it set up so they can put in a payment and a disclaimer,” Kelly continued. “It’s one thing to say they need to put in a disclaimer. It’s another thing for them to be able to understand what makes a good disclaimer.
“Hopefully with this new series that we’re putting into our back end, that might at least get the ball rolling in helping them to better understand what makes up a good disclaimer and what really is transparent,” he went on to say.
Kelly and Silverman explained this compliance commentary idea first germinated when they crossed paths at the National Independent Automobile Dealers Association Convention this past summer. After a couple of conversations, they decided to push forward with this offering from the Buy-Here, Pay-Here Center, which remains free for BHPH operators to use through May of next year.
“I’ve been going to these conferences for several years,” Silverman said. “Coming from the consumer collection industry, it was really amazing to sit around and listen to everyone at the auto dealership conferences talking about compliance. Almost three years ago people were talking about that there’s the Dodd-Frank act and this thing called the CFPB.
“I was really living the future from what everyone at the auto conferences was speculating about,” he continued. “I really know what was coming down the pike now and what’s coming next year not because I’m a soothsayer, but because I’ve been living it. And it’s awful. I know how serious these guys are. I know what it’s like being down at the bottom of the totem pole as a recipient of all of these regulations.”
Silverman plans to send something to AutoTrader.Com for the Buy-Here, Pay-Here Center at least once per month to keep BHPH dealers as informed.
“The goal is to give dealers an easy line to call for help. They can always call, and we can talk about whatever their particular issue is,” Silverman added.
Both Kelly and Silverman emphasized that the goal of this project is to keep BHPH operators updated so they’re not caught flatfooted if they receive a civil investigative demand or some other alert from a regulator.
“When you say education, you hit the nail on the head. That’s a subject that’s very near and dear to my heart,” Silverman said.
“I think the answer to all of our problems is just good education. More problems are going to result from poor or no education. It’s the way to go,” he continued.
“I think the buy-here, pay-here space is going to be in for some serious surprises, not to mention the rest of the auto world, on the collections side because especially in the advent of UDAAP and the redefinition of UDAAP by the CFPB all of the auto finance companies that are doing internal collection work, are now going to subject to all of the FDCPA laws,” Silverman went on to say.
Silverman further explained what he meant by that statement about the Fair Debt Collection Practices Act (FDCPA) and how the Consumer Financial Protection Bureau interprets the Unfair, Deceptive Abusive Acts or Practices (UDAAP).
“If I loan you money, I can call and my collection efforts are not subject to the FDCPA. Now under UDAAP, that’s no longer true,” Silverman said. “There’s a whole body of case law and all of the districts in the United States many of which interpret that law differently that are going to be at disposal of (CFPB director Richard Cordray) to hammer on all of the collection activities of the buy-here, pay-here dealers and the even the finance companies that have their own collection departments and programs.”
In the song, “The Gambler,” Kenny Rogers sang these words:
“So if you don’t mind me sayin’ I can see you’re out of aces. For a taste of your whiskey, I’ll give you some advice.”
Now I don’t know much about gambling, and I don’t think my firm would accept payment in whiskey, so my thoughts on this ACE matter are on the house.
The key to remember is that in a compliance “card game” with the Consumer Financial Protection Bureau, don’t assume Ace High is a winning hand.
On July 8, the CFPB entered a consent order against ACE Cash Express. ACE is a publicly traded financial services company offering small dollar credit, check cashing and other financial services. The CFPB examined ACE in early 2012.
The CFPB ultimately ordered ACE to pay $5 million in restitution to consumers and $5 million in civil penalties to the CFPB. So, the question is: Was this payday lender “dealing from the bottom of the deck,” or does the house (CFPB) always win?
It appears to be more often the latter than the former. Regardless, there are lessons you can learn from this consent order.
Lesson No. 1: Collections and Urgency — A Worse Pair than A Couple of Twos
The CFPB press release on ACE refers to the problem of creating a “false sense of urgency.” But, CFPB director Richard Cordray’s prepared remarks and the consent order simply address creating a “sense of urgency,” as if that alone constitutes a deceptive and abusive act.
Federal collection laws have always prohibited deceiving debtors and communicating false information. But, the CFPB seems to be moving beyond prohibiting a “false sense of urgency” to prohibiting any sense of urgency in collections.
Obviously, collectors should never provide false information. But, the collection of money owed is an urgent matter — at least for the creditor.
The lesson here is to review collections policies and procedures and remove any language or procedures that the CFPB may deem “create a sense of urgency” in the collection process.
Lesson No. 2: The Secret to Survivin’ is Knowin What to Throw Away and Knowin’ What to Keep
ACE claims to make millions of collection calls each year, which it voluntarily records for customer service and compliance monitoring purposes. According to an independent audit report, more than 96 percent of ACE’s calls during the review period met relevant collection standards.
While voluntarily recording all collection calls and saving them for independent auditing seems to be a great compliance practice, it seems to have backfired on the company. ACE received no credit from the CFPB for saving these recordings and largely complying with federal law.
Instead, the CFPB used the existence of old recordings, which many organizations may have otherwise properly disposed of long ago, simply to find alleged compliance violations.
The lesson: Companies should evaluate their call recording and record retention policies and discuss the pros and cons of such policies with counsel.
Lesson No. 3: When It Comes to Reasonable Measures, Every Hand’s a Winner, and Every Hand’s a Loser
The consent order states that ACE must “take reasonable measures to ensure that its service providers, affiliates, and other agents cease and desist from any violations of the law.” By all accounts, ACE did monitor internal and external collection activity.
The CFPB even noted that ACE’s vendor contracts addressed collection activities. ACE recorded and monitored calls, and more than 96 percent of ACE’s calls met relevant collection standards.
In most contexts, 96 percent is a mark of success. It certainly seems to indicate that ACE may have been taking “reasonable measures.”
The consent order, the press release, and director Cordray’s prepared remarks, fail to quantify the number of collection calls the CFPB reviewed and the number of alleged violations. So, whatever you’re doing to reasonably assure collection compliance, you should “double down.”
The CFPB seems to be taking the position that if it finds any compliance violations, your “reasonable measures” were not reasonable enough. You may see your “reasonable measure” as a winner, but the CFPB may see a loser.
Lesson No. 4: Restitution — There’ll Be Time Enough for Countin’ When the Dealin’s Done
ACE was ordered to pay $5 million to give “restitution to eligible consumers,” a term broadly defined as all individuals subject to collections, who made a payment during the relevant period. Each restitution eligible consumer is entitled to the amount paid to ACE plus 1.3 percent, a seemingly random calculation with no explanation provided in the consent order.
The problem is that anyone who paid in the collections process could get a payment, even if that person was never subjected to the alleged misbehavior. Simply submitting a claim form is enough, and recorded calls demonstrating compliance with that particular consumer won’t matter.
Individuals who were never subjected to alleged bad acts will receive funds, depleting the funds available to those with legitimate claims.
While the consent order is technically a settlement, my understanding is that the CFPB offers the settlement as a “take it or leave it” deal, with pressure to agree right away. So, the lesson here is that the restitution and penalties aren’t quantifiable and aren’t tied to actual consumer harm.
If compliance issues affect even a small percentage of consumers, the CFPB may hit you with an incongruent penalty that doesn’t consider the number of consumers harmed.
Lesson No. 5: And the Best that You Can Hope For Is in your sleep
A bit over the top, perhaps. But, it reflects the histrionic tone of CFPB press releases about consent actions and enforcement activities. They read a little like the embellished tales in Old West dime novels.
And, the CFPB went “all in” with the ACE press release and director Cordray’s prepared remarks.
Both were replete with name-calling that would have ignited a gunfight across any saloon card table. The CFPB accused ACE of being a “bully” and maintaining a “culture of coercion.” The CFPB alleged “predatory behavior” and taking actions to “lure” borrowers into “traps.”
The CFPB made these statements as if they were facts, without noting the limited percentage of consumers affected, ACE’s significant compliance efforts, and the corrective actions already taken by ACE.
“The Gambler” in Kenny Rogers’s song made a living “out of reading people’s faces” and knowing what the cards were. That’s a good practice to emulate when a CFPB field examiner comes calling.
Does a poker face imply no significant compliance issues? Our experience says be wary. The tone at the end of an examination may belie the eventual press release.
Companies should anticipate similar treatment from the CFPB and consider the narrative during negotiations.
All financial services companies should heed these lessons. You may think your company is holding a solid compliance hand, but the CFPB expects a Royal Flush.
If you lose the hand with the CFPB, you may face random penalties and an ugly press release.
Should you find yourself in that unenviable seat across the table from the CFPB, I hope you “found an ace” or two here to help you. If not, you might need that shot of whiskey.
H. Blake Sims is a partner in the Tennessee office of Hudson Cook. Sims can be reached at (423) 490- 7563 or by email at bsims@hudco.com.
Just before Thanksgiving arrives and the holiday season cranks up in earnest, the National Alliance of Buy-Here, Pay-Here Dealers is giving veteran operators as well as professionals who want to close 2014 by learning more about the industry the chance to see all elements of a thriving operation in action.
NABD's next BHPH Boot Camp is set for Nov. 8 and 9 in Monroe, N.C., just east of Charlotte. Attendees will have the opportunity to examine all parts of the BHPH operation of Ingram Walters, who has been associated with NABD since its inception and has been running his own dealerships for more than 20 years.
Doug Radcliff went to a previous boot camp. Radcliff has been the general manager of the Sam Swope Advantage Plan in Louisville, Ky., for more than 20 years. The Sam Swope Automotive Group is the largest franchised dealer group in Kentucky and has a thriving BHPH division.
“I told Ingram that I’ve been doing this for 22 years. I was hoping to come down and maybe get one or two little pointers here and there. Fortunately, I came back with 100 of them,” Radcliff said.
“We’re not in a 20 group for buy-here, pay-here, so their boot camp and seeing the operation from start to finish was extremely good and very helpful,” Radcliff added.
Walters, along with NABD founder Ken Shilson, intend to use the two days to outline every step that it takes to create a successful BHPH store, from establishing a related finance company, regulatory compliance, underwriting and collections, to finding inventory that will turn quickly.
Space is limited for this session. Dealers and other interested individuals can register for the boot camp by visiting bhphinfo.com.
NABD Announces Details of BHPH Best Practices Conference
While also getting ready for that boot camp, NABD also released early details of its BHPH Best Practices Conference, which will be at the Hilton DFW Lakes Executive Conference Center in Dallas on Jan 18 through Jan. 20. The conference theme will be, “Working Smarter and Avoiding Compliance Pitfalls.”
For the last four years, NABD has hosted several popular BHPH Dealer Academies prior to their annual National BHPH Conference each May in Las Vegas. Three of those focused on “best operating practices” and the fourth on regulatory compliance.
January’s dual-track conference program will include the most popular sessions from these past academies and some new ones.
The compliance track will feature several of the nation’s leading attorneys and experts including Shaun Petersen, Tom Hudson, and several others who will help attendees learn how to comply with all of the latest legal and regulatory developments.
“It is a ‘must-attend’ for owners, general managers, collectors, compliance officers and key employees,” Shilson said. “These interactive sessions are designed for both experienced operators and those just entering the industry – both independent and franchise operators
“All attendees will receive a certificate of participation evidencing the training,” Shilson continued.
The program begins at 2 p.m. on Jan 18 and concludes by 1 p.m. on Jan. 20 and is designed to minimize the time key employees are away from their operations.
“What they will learn at this conference will enable them to succeed in today’s highly competitive BHPH marketplace. Learn more, earn more,” Shilson said.
In the best practices track, some of the nation’s best operators will share their tips and techniques that will help attendees overcome the competitive market challenges from the special finance industry, credit unions and others.
The compliance track will help attendees avoid the legal and regulatory mistakes which are being carefully monitored by the Consumer Financial Protection Bureau, state attorneys general, and the Federal Trade Commission.
NABD insisted all of these sessions will be interactive so attendees can get answers to their questions. Multiple attendees are encouraged to participate in both of the educational tracks.
The exhibit hall will feature more than 70 leading service and product providers, who will help operators be more successful, including: new capital providers, new technologies, add-on products, auctions, accountants, collection and underwriting products, and much more.
Two receptions will be held in the exhibit hall to facilitate networking between attendees, sponsors and experts. The program also includes a luncheon on Monday and a breakfast with exhibitors on Tuesday morning.
Exhibit space is limited, so interested sponsors are encouraged to contact Keith Shilson at (832) 767-4759 at their earliest opportunity while space is available.
NABD highlighted the Hilton DFW Lakes Executive Conference Center is an exceptional venue located near DFW International Airport. Ground transportation is provided between the airport and the hotel for the attendees’ convenience and savings. Attendees from the Dallas area will enjoy free surface parking at the hotel.
NABD has arranged discounted room rates of only $169 per night with no resort fees, while supplies last.
In addition, significant attendee discounts are available for registrations received on or before Dec. 19. A preliminary agenda and more information is available online at www.bhphinfo.com or by calling (832) 767-4759.
